Calculating the value of customers’ referrals

Abstract

Word‐of‐mouth is a rarely quantified phenomenon, in spite of its importance for service firms. Therefore, referrals remain a neglected determinant of customer lifetime valuation, although some authors claim them to be the astronomical part of customer equity. The paper discusses different approaches to the calculation of positive word‐of‐mouth, leading to a monetary referral value of a company’s customers.

Citation

Helm, S. (2003), "Calculating the value of customers’ referrals", Managing Service Quality: An International Journal, Vol. 13 No. 2, pp. 124-133. https://doi.org/10.1108/09604520310466825